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Bespoke Wealth Management – Investing in fine art or collectibles

When choosing a piece of fine art or a collectible, there are many different things to consider and assess. Initially, there is the practical side; you might contemplate whether a piece will suit your current interior design style, whether you have space for it or if it is within your budget. Undoubtedly, and perhaps more importantly, you will also need to evaluate more emotional factors, such as how it makes you feel and whether the purchasing of said item is a decision you feel confident in making.

The process of purchasing and appreciating art is an incredibly personal one and is not the same for any one person – something that can also be said for wealth management and financial planning. Personal circumstance, risk appetite, and preference mean that the right wealth management journey can differ drastically depending on the individual, and at Blacktower, we understand how important it is that the service we provide reflects that. To us, bespoke wealth management not only means appreciating that financial goals and objectives differ from person to person, but also that priorities will evolve throughout an individual’s lifetime too;  just as our taste in art might change over time, so do our financial needs.

Although wealth management is far from a ‘one-size-fits-all’ solution, the benefits of long-term financial planning are universal. It goes without saying that this is absolutely essential if you want to establish and maintain control over your finances whilst ensuring you get the most out of your hard-earned assets. Whether you are hoping to find the most efficient way to pay on your wealth to the next generation, or simply want to enjoy retirement without the constraints of financial restriction, the earlier you seek expert advice the quicker you are likely to achieve these goals, and the fewer sacrifices you are likely to have to make.

Whilst this might make securing your financial future seem simple and straightforward, we understand just how complex the reality can be. Effective wealth management involves the development of a personalised, extended strategy, often with multi-asset approaches to investment to ensure maximum growth. Navigating this landscape alone can be incredibly daunting and even counter-productive if you are not equipped with the adequate knowledge or experience, with decisions only becoming more complicated and intimidating if you are an expat or moving abroad. The range of options available can be overwhelming, making it tempting to keep your money liquid as opposed to investing it, but ultimately, this decision is only detrimental to long-term growth. Well-executed investments can truly be life-changing, making you far more than any savings account interest will ever return; a good financial adviser pays for themselves over time and time again in peace of mind, time saved and potential returns on your investments.

In our efforts to simplify the complex for our clients, we make our process as straightforward as possible; beginning with a no-obligation complimentary consultation to review your finances and personal circumstances, your adviser will then be able to solidify your goals and the relevant timelines. They will then provide you with advice on how best to achieve these objectives, offering insight into possible strategies.  Once you have selected an approach that you are comfortable with, your adviser will formalise this in a wealth management plan for you to review. With transparency and consistent communication at every stage of the process, you never have to feel as though decisions regarding your finances are out of your control or being made without your knowledge or consent, giving you confidence in the direction of your financial future.

With a global team of experienced financial advisers and offices in the UK, US, Cayman, Australia, Switzerland, and across the EU, our regulatory footprint allows us to assist those moving abroad permanently, or as temporarily. If you would like to arrange a complimentary review of your finances and take your first step to securing your financial future, for yourself and your family, you can contact us by visiting blacktowerfm.com or by using the details below.

This communication is for informational purposes only and is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice from a professional adviser before embarking on any financial planning activity. Whilst every effort has been made to ensure the information contained in this communication is correct, we are not responsible for any errors or omissions.

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Final salary pensions – why now is a good time to cash in

Juicy lottery-sized sums are being offered to savers to tempt them out of gold-plated workplace pension schemes and into personal plans. We’ve explored whether you should consider taking a final salary pension, as well as the benefits and drawbacks of withdrawing.

What is a final salary pension?

A final salary pension, sometimes referred to as a gold-plated pension, is a special style of retirement fund that is based on your final or average salary.

The main difference between this and a defined contribution pension is that a final salary scheme gives you a guaranteed sum annually for the rest of your life when you retire.

To work out the value of your final salary scheme, consider a few factors: 

  1. Your final or average salary at your place of employment (confirm this with your employer)
  2. Your length of service
  3. The final salary scheme’s accrual rate (this is often 1/80th)

Your final salary pension will take each factor into account, and the resulting figure will be the guaranteed annual sum you are entitled to.

For instance, if you worked somewhere for ten years, and leave on a salary of £100,000, with an accrual rate of 1/80th, you will have a guaranteed retired annual income of £12,500.

It is possible to undertake a final salary pension transfer. Depending upon how long you expect to enjoy retirement, this could be a favourable choice. However, it’s important to consult a financial advisor to make your final salary pension transfer values work harder.

What are the benefits of transferring a final salary pension?

Assessing your final salary pension transfer value, you might consider it worthwhile to withdraw. We’ve outlined the main benefits of taking your final salary pension:

Receive the cash value of your final salary pension

Withdrawing from a final salary scheme allows you to receive a cash lump sum in return for forfeiting your guaranteed income in retirement. This final salary pension transfer value is the main reason to withdraw from a scheme, as it offers you financial freedom.

Remove ties with your employer

This is an especially important point if you’re concerned that your employer may not exist throughout your full retirement. For most, the pension protection fund (PPF) will cover your pension, but, for especially high earners, there is a PPF ceiling of £41,461 (as of April 2020).

Enjoy a flexible income in your retirement

A final salary scheme entitles you to a guaranteed annual income when you retire, but if you go down the route of transferring your final salary pension you will be able to enjoy a little more flexibility in how you receive your income. Usefully, by withdrawing from your final salary scheme, you can choose to take more out in your younger years.

Choose how you want to invest your pension

A final salary scheme is controlled tightly to accommodate all employees and their interests. When withdrawing from the scheme, however, you can take complete control over how your pension fund is invested.

The considerations you should make before transferring your final salary pension

While there are certainly benefits of going down the route of transferring final salary pension funds into various other pots, it’s important to consider what you’ll be giving up:

  • Entitlement to a fixed annual income for the rest of your life
  • A safe income that doesn’t fluctuate with volatile markets and share prices
  • Spousal and family benefits that come with a final salary scheme

 Example: Should I cash in my final salary pension?

An example is Mrs Dee (not her real name), 4 years ago she asked for her final salary transfer values, which came in at £250,000 – a nice sum, you may think. After reviewing all the facts and figures available, however, I advised Mrs Dee to leave her final salary pension where it was, which she duly did.

Towards the end of last year, because of favourable market conditions, I applied again to see the value of transferring her final salary . This one came in at just under £600,000.

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